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Shares surge on rumor of ST interest in Hynix

Posted: 18 Jul 2005 ?? ?Print Version ?Bookmark and Share

Keywords:hynix semiconductor? memory chips? flash memory?

Shares in Hynix Semiconductor Inc. surged 8.4 percent after the Korean memory chipmaker said it had been approached by STMicroelectronics NV to begin talks on expanding the two companies' alliance in memory chips, according to an Associated Press report. That expansion could involve ST taking a stake in Hynix, reports said.

Hynix has just completed a debt work-out program and creditors, who own about 74 percent of Hynix, are now looking to sell about 24 percent of the company following the early completion of the four-year debt restructuring process according to reports on Tuesday (July 12).

In a filing made to Korea's Financial Supervisory Service Thursday, Hynix said it has received a proposal for talks but no discussions have taken place so far, according to the report. The filing was made after the Korea Economic Daily cited unidentified industry sources earlier in the day as saying ST had offered to exchange NOR flash memory manufacturing lines in return for a 10 percent in Hynix, the report said.

STMicroelectronics issued a statement saying that "discussions with competitors and partners are a normal daily practice for all companies in the semiconductor industry." The company declined to comment further.

ST and Hynix have begun work on a joint wafer fab in Wuxi City, Jiangsu Province, China, making ST a natural partner to take up available stock in Hynix. The total investment planned for the project is $2 billion, financed with the equity split between Hynix and ST at 67 percent and 33 percent respectively. When completed the Wuxi fab is scheduled to manufacture both DRAM and NAND flash memories as an extension an existing manufacturing relationship between Hynix and ST (see April 28 story).

- EE Times





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